BROOKLYN, N.Y. -- Improved economic conditions worldwide, particularly in the U.S., and a booming memory chip market are being credited for the global semiconductor industry’s robust sales growth in the first half of 2014.
According to the latest numbers compiled by the World Semiconductor Trade Statistics (WSTS) organization and endorsed by Semiconductor Industry Association, global sales in June grew 10.8%, to $27.57 billion from $24.88 billion in June 2013, and 2.6% from $26.86 billion in May. June’s numbers represent the industry’s highest monthly sales level recorded, according to the SIA.
In the second quarter of 2014, worldwide chip sales reached $82.7 billion, up 10.8% from thee second quarter of 2013, and 5.4% sequentially. Global sales were up 11.1% in the first half of 2014 compared to the same period in 2013, which was a record year for semiconductor revenue. WSTS projects growth of 6.5% in 2014, 3.3% in 2015, and 4.3% in 2016, said SIA President and CEO Brian Toohey.
“The semiconductor industry is on pace for record sales in 2014, and conditions are favorable for continued market strength for the remainder of 2014 and beyond,” Toohey told EE Times.
Toohey said that sales are up this year across nearly all semiconductor product categories, “which shows the breadth of the market’s strength in 2014.” Memory products, including DRAM, have been one of the strongest sectors.
“Memory chips go into a wide range of end products, including PCs and communications devices, which represent the two largest semiconductor end use markets. Strong demand for memory chips, combined with less added production capacity, has led prices to increase and revenues to grow,” he said. Toohey also cited the analog and logic chip markets as key contributors.
In June, DRAM was up 29.2% compared to June 2013, analog was up 13.5%, and logic was up 12.1%, according to the WSTS figures.
Geographically, the Americas posted the largest sequential gains in June, growing 4.9 percent compared with May 2014. Semiconductor sales in Asia-Pacific, as well as Japan, grew 2.1%, and Europe inched up 1.9%. And the gains were even larger compared to June 2013 as sales increased 12.1% in both the Americas and Europe, 10.5% in Asia Pacific, 8.5% in Japan.
“In terms of growth drivers, PCs still represent the largest end product for semiconductors, and demand for smartphones and tablets is on the rise,” Toohey said. Although these product categories will remain important drivers of market strength, the pie is constantly getting bigger, he added.
“Emerging product markets -- the Internet of Things, big data, medical, transportation, and others -- will continue to grow and help ensure the continued strength of the semiconductor industry for years to come,” Toohey said.
In addition, the global semiconductor market is likely to sustain its progress in subsequent years as worldwide economic growth gradually accelerates in developed economies. According to a recent Dun & Bradstreet report, worldwide GDP growth is estimated at 2.7% above last year’s marginal gain of 2.4% and well below 2007’s pre-recession rate of 5.2%. Dun & Bradstreet expects conditions to gradually accelerate over the next few years, citing a 3.3% worldwide growth increase in real GDP for 2015, with further advancements to occur over the next three years.
Ismini Scouras is a freelance writer for EE Times.